Gaza witnesses said Israeli aircraft launched 35 attacks, including one on a house in Gaza City, where hospital officials said a woman and a two-year-old girl were killed and 45 people injured. A third unidentified person also died in the strike, officials said. Another eight people were hurt in earlier air raids across the Strip.

The military wing of the Islamist Hamas, the Ezzedine Al Qassam Brigades said in a statement that it fired 34 rockets into Israel yesterday, hitting Tel Aviv and the southern city of Beersheva. The Israeli military confirmed hits in both places but there were no reported casualties.

"A rocket hit an open area in the Tel Aviv metropolitan area," a statement said. Earlier the army said two rockets hit near Beersheva, which is home to around 200,000 Israelis. Air raid sirens were also heard in Jerusalem, with Hamas claiming a rocket attack on the city, although there were no reports of a rocket falling in the city.

Israeli officials said 10 rockets were fired from Gaza, the first of which were launched around eight hours before the truce was due to end at midnight. Two were intercepted by Iron Dome, Israel's vaunted anti-missile defence system. Sirens sounded in the centre and south of the country, and bomb shelters within 80km of the Gaza border were reopened.

"There has been no progress," Azzam Al Ahmed, chief Palestinian negotiator in Cairo said. The renewal of Israeli air strikes spread panic among Gaza residents. Witnesses saw hundreds of Palestinians streaming out of Shejaiya, an eastern area of Gaza City.